Market saturation and slowing smartphone sales globally are to blame for a record drop in smartphone shipments to Europe in the first three months of 2018, with Western Europe registering the biggest fall in the region.
In the three months to March, smartphone shipments to Europe fell by an unprecedented 6.3 per cent year on year, according to Canalys. While shipments to western Europe shrunk by 13.9 per cent, developing central and eastern Europe registered a jump of 12.3 per cent, driven by Russia’s strong performance.
Global smartphone sales fell 2 per cent in the first quarter, with smartphone suppliers bemoaning a slowdown even in growth markets like India and China, according to separate data from GfK.
Samsung remained the top smartphone vendor in Europe notwithstanding a 15.4 per cent tumble in unit shipments, the Canalys report showed.
Apple outperformed its peers and sold more than 10m smartphones in the continent, despite a 5.1 per cent drop in shipments. But older models such as the iPhone SE, 6 and 6S accounted for a chunky 25 per cent of Apple’s shipped goods, at a time when boosting sales of pricier premier phones is key to counter slowing sales of smartphone units worldwide.
Chinese high-tech group Huawei bucked the European market trend and reported a 38.6 per cent jump in number of shipped units. But similar to Apple, a delay in the P20 model meant most Huawei shipped units were not premium phones.
Although saturated markets and declining global sales are set to hit smaller players the hardest, new entrants Xiaomi and Nokia, which is part of HMD Global, have performed strongly in Europe, with Xiaomi shipments ballooning by more than 1,000 per cent in the first quarter alone.
As private companies, Xiaomi and Nokia can afford to run significant net losses to crack the European market. “But this is not sustainable in the long term, and both Xiaomi and HMD Global will eventually have to shift their revenue and cost structures, as the top three [Samsung, Apple and Huawei] have now done, toward profitability,” said Lucio Chen, research analyst at Canalys.
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